Nuclear power and Australia

There’s been a bit of discussion about nuclear power lately, but it tends very much to the abstract. I thought I would look into the question of when, if ever, nuclear power might be a reasonable option for Australia to consider, and how we should go about it.

An obvious starting point is the Switkowski report commissioned by the Howard government, which I’ve uploaded here. There are three main points which allow me to provide an answer to the question, at least for the next decade or so.
(i) In the absence of a substantial carbon price nuclear power is not competitive with coal
(ii) First-of-a-kind (FOAK) nuclear plants are likely to be very expensive (above $80/MWh), not competitive with wind or gas (even with CCS)

The estimate is that ‘settled down’ long run costs could be $40-$65/ MWh, which is competitive with wind and cheaper (for the moment) than other renewables.

Let’s take “settled down” to refer to a design with at least 5 examples completed and operating in developed countries, at least some of them built on greenfield sites (that is, not next to existing nuclear power plants which already have a lot of the necessary infrastructure). It seems clear that these minimal conditions can’t be met before 2025 at the earliest. The US, which has been attempting for a decade to restart its nuclear industries is still at the pilot stage, exploring a number of technologies, and offering to subsidise the construction of three plant designs for each major option. Most of the proposals are on existing sites, only six have reached the point of a plant actually being ordered, and none is anywhere near starting construction. Given a sharp acceleration in progress, the emergence of a highly successful design and a lot of new orders towards the end of this decade, the 2025 date might just be reached.

That suggests that Australia should forget about nuclear power entirely for at least the next five years. If things are going well for nuclear, and not so well for renewables, that would be the time to start setting up regulatory structures, looking for sites and so on.

You haven’t mentioned geothermal power. Geodynamics (GDY) has a plan to develop a 500MW geothermal power station in the Inaminca area, but the timing seems to depend on funding.
From a technical point of view, geothermal should be the cheapest non-polluting source of power in the medium term – certainly cheaper and sooner than nuclear plants. All it needs is holes in the ground.

I’m not sure about the costs either. Wind requires a lot additional transmission as well as backup plant to deal with poor capacity factor. These costs are often omitted.

We don’t have an explicit carbon cost today but we still get wind farms due to MRET. There is no good reason to continue the prohibition of nuclear or to exclude it from MRET if permitted.

Delaying the reform process is much the same as supporting prohibition. If you think nuclear should be prohibited then just say so. If you think it should be permitted with qualifications (ie specific regulations) then state the case. Obviously we all care about cost but so long as these are in the ball park there is no reason to prohibit entry on the basis of cost speculation.

Nuclear power is safer than coal and when construction and operation are included it omits less CO2 than any comparable alternative.

Mike Smith, the costs of long-term waste storage are essentially lost in the noise. Yes, it costs a lot of money, but the revenue accrued from running a power station for 60 years easily covers the cost.

PeterS: Geodynamics (and the other geothermal entries in the geothermal power sector) have been promising for a long time, and haven’t actually delivered much yet. The technology is not proven.

But back to our blog host’s main point, the question of whether nuclear power becomes necessary in Australia depends a lot on the availability of carbon credits from overseas, and the consequent level of pressure on our domestic emissions.

PeterS – I wish geodynamics all the best. However attempts to commercialise hot dry rock style geothermal have been going on since the early 1970s. It remains speculative. I certainly wouldn’t want it excluded from the market but I wouldn’t bank on it either.

Given a sharp acceleration in progress, the emergence of a highly successful design and a lot of new orders towards the end of this decade, the 2025 date might just be reached. […] That suggests that Australia should forget about nuclear power entirely for at least the next five years. If things are going well for nuclear, and not so well for renewables, that would be the time to start setting up regulatory structures, looking for sites and so on.

In a political sense, I’d readily agree that we are unlikely to see nuclear power in Australia much before 2030. There’s absolutely no incentive for either party to take up this issue regardless of the feasibility of nuclear power relative to other options. It’s high risk low return politics, especially for the ALP. Since the ALP is likely to be in power until 2013 and probably 2016 federally and even the Liberals would be unlikely to try this first term or even propose it when the election was in the balance so it would seem 2030 would be the earliest date we would get any such facilities, allowing for the most likely approval cycle.

With that in mind it really wouldn’t matter if someone with credibility could persuasively show that nuclear power’s fully levelized costs could deliver a steady 25GW 24/7 at 1/3 the cost of coal. It wouldn’t be on the agenda. As I’ve said elsewhere, that probably doesn’t matter (except to those here harmed one way or another by combustion of coal) because Australian GHG emissions are small. It’s open to us to choose expensive means to reduce emissions and play the role of international laggard.

That said, we have plenty of brownfield coal and industrial sites on which nuclear power stations ought to be capable of being installed in a fairly minimal time with minimal extra ancillary cost whioch would immediately improve local amenity. We are talking of doing desal pretty much everywhere and again, nuclear + desal is a pretty good fit.

One can easily foresee the day when installed costs of nuclear are similar to that of coal — the AP1000 series being rolled out in CHina probably will make this plausible. If we do LFTRs then we can probably talk other states wondering what to do with their HLW to send it to us, for a fee, and then not only produce cheap power but reduce the colume of weaponizable materiel.

Lastly, CO2 really ought to be priced at closer to $100 per tonne. If renewables really can compete in that cost environment, then let them do so, without MRETs. Gioven my remarks above, if we could see a regime in which from 2013 all coal plants would begin phase-out by 2030 in favour of renewables + some NG + pumped storage I wouldn’t be at all miffed.

Early expensive but substantial reductions in CO2 emissions are better than larger cheaper ones two generations later. I’d prefer nuclear power to start replacing coal by 2013, but if I can’t have that because not enough share my view, then let’s have the next best suite of options.

@TerjeP (say tay-a)
The MRET (about which I am somewhat dubious, I must say) is supposed to help the developed of new kinds of energy, which are just beginning to be developed. Nuclear power has already benefitted from massive subsidies – no more are justified.

In any case, there is no chance of getting a nuclear power plant up and running by 2020, which makes this point academic (in the pejorative sense of the term). The MRET will expire long before it would be relevant.

Let’s take “settled down” to refer to a design with at least 5 examples completed and operating in developed countries, at least some of them built on greenfield sites (that is, not next to existing nuclear power plants which already have a lot of the necessary infrastructure). It seems clear that these minimal conditions can’t be met before 2025 at the earliest.

Although it is against my technophilic religion to admit it I have to acknowledge that it will take a long time to set-up and embed workable nuclear power plants to our main grid. Thats not just ole’ nay saying Quigginism, its the French who say this. Whats more they exactly agree with Pr Q’s estimate of 15 years to get proper regulatory status. The Bulletin of Atomic Scientists quotes French authorities in “testimony against interest”:

But despite France’s best efforts to the contrary, it’s unlikely that the wannabe nuclear players will implement nuclear power programs any time soon–if ever. None of these countries have the necessary nuclear regulations, regulators, maintenance capacity, or the skilled workforce to run a nuclear plant.

The head of France’s Nuclear Safety Authority has estimated that it would take at least 15 years to build the necessary regulatory framework in countries that are starting from scratch. (The French government is well aware of this problem; last month, it created the Agence France Nucléaire International within its Atomic Energy Commission to “help foreign states to prepare the institutional, human, and technical environment necessary for the development of a civil nuclear program.”)

The question remains: why the enormous delay in writing up a bunch of rules? It only took the Jefferson a couple of weeks to knock together the US constitution. Is the constitution of a nuclear power plant hundreds of times more complicated?

Its a pity the French cant just export pre-fab nuclear power plants like the do pret-a-porte fashion.

The assumption seems to be that some forms of non-hydro renewables can substitute for base and intermediate load power now supplied by burning coal and gas. Evidence from several countries does not support that , nor do I see convincing evidence that dry rock geothermal will ever be able to provide that quality of supply. In discussing capital costs it made be prudent to divide cost per watt by capacity factor, example PV solar $6/.16 = $36, prime onshore wind $2.50/.33 = $7.50, Gen III nuclear $5/.92 = $5.43. Multiply by 1000 for costs per MW.

Some advocate a major switch from coal fired generation to gas fired on the basis of apparently large gas reserves which is what the Brits thought during the Thatcher years. That may limit CO2 cuts to only 50% versus coal but it would support more showpiece wind and solar in conspicuous locations, a political plus. However the gas price is certain to move with LNG export parity and increasing demand from the transport sector, thereby making gas fired electricity quite expensive despite a carbon advantage.

Without waiting for Gen IV nuclear some major Gen III developments are in the pipeline. The Chinese may be able to get construction time down to three years and the South Koreans will demonstrate large scale nuclear desalination in the massive project for the UAE, a country which has plenty of sunshine yet it recognised the limitations of solar. That desalination uses free waste heat from the cooling system not so much the high pressure pumping of the reverse osmosis plants now springing up around Australia. Reactors may also get smaller and modular through offsite prefabrication. I suggest that Australia should put its name down as soon as possible for a proven combination of Gen III with integrated desalination. Meanwhile bureaucrats should work on smoothing the path for a number of suitable sites.

According to Box 1.1 Australia’s involvement in the nuclear fuel cycle in the 2006 report, there cannot be radioactive contamination in Hunters Hill, Sydney due to a nuclear facility, however small, because there was none!

This is a minor point on record keeping, except for those who have bought one of these contaminated properties in Hunters Hill and those who try to convince others that no record keeping problem can occur in waste storage systems that involve many generations into the future.

Lets see how the renewables and electricity demand develops in the near future.

@Hermit
As I’ve pointed out quite a few times now, the while idea of “baseload power demand” is a nonsense. What the argument comes down to is that if you want a generating technology that has the same characteristics as coal (always avaiable, hard to turn off) nuclear is the best choice. And, since our current pricing and distribution systems are set up for that, it’s also true that, if you can’t change anything but the generation technology, nuclear looks good.

But what we actually want is power that is mostly on during the daytime and early evening, which suggests that solar + some storage option is likely to be a better match. And, if supply is variable, prices have to do more work in matching it to demand.

JQ I have to disagree and by the way I have eliminated my home electricity bills. That’s because the fluctuation in my near trivial electrical output is easily absorbed by the much larger grid. That grid would become unstable if all the contributors had irregular output. Wikipedia opines that 40% of peak electricity demand can be considered the minimum requirement which has to be produced 24/7. Industries like aluminium smelting also work around the clock and can’t cope with the vagaries of irregular output. Hospitals have back-up generators but prefer to use them infrequently.

You may be right that off-peak electricity pricing for water heating is an artefact of baseload power. Then again negative pricing (paying to take it away) is an artefact of feed-in tariffs for wind power in Europe, that is to keep the subsidy happening even when windpower is not wanted. Energy storage could greatly increase household electricity prices. An estimate for energy retrieved from lead-acid batteries is 11c per khw (on top of the production cost) due to rapid depreciation and interest on high capital cost. I doubt there is more than about 5 GW continuous average pumped storage in the hydro schemes of eastern Australia and that would also require major new transmission. We want at least 20 GW of continuous low cost low carbon generation, not an expensive 5 GW.

As for more elaborate time-of-day pricing schemes using smart meters or plugged in battery cars I’ll await further results as they come to hand. So far the evidence is uncompelling. From my POV I’m convinced by the ‘baseload truism’.

@Chris Warren
“If society did not outlaw slavery (for political reasons) the Australian Productivity Commission would have already published papers seeking greater efficiency through increased slave labour.”

Sounds like you have a gross misunderstanding of labour economics and productivity calculations. But on to your substantive point:

“The core arguments against nuclear power are not economic….The concerns with nukes exist irrespective of a price comparison of energy output with other options.”

I’m not so sure. The concerns are capable of translation into monetary values, therefore are quantifiable and amenable to economic analysis.

(option 1) an Australian wage, or
(option 2) for one tenth (through oppressed labour),

then your;

“translating this into monetary values” and

“quantifying it” with

“amenable economic analysis” still produces the same conclusion.

Faced with this scenario, the Australian Productivity Commission would still publish a paper recommending greater efficiency through increased oppressed labour.

They would still argue that imported oppressed workers in Australia would be better off than in their homeland, so everyone benefits. They may even say that the increased efficiency will fund labour market adjustment programs for any Australian workers who need to change industry etc etc.

So if you think you can explain how “labour economics” and “productivity calculations” contradicts this – please go ahead.

However it is hard to see how productivity calculations are relevant as precisely the same product is being produced in both scenarios – the only change is the politically determined wage.

One challenge that pro-nuclear activists have is that so many people in the discussion are focused on short term effects. When talking about constructing power plants that will most likely last for 60 years, they want me to prove that their will be a positive – and generous – financial return on their investment in just 5-10 years.

They want nuclear energy plants to be immediately competitive with highly refined, large scale coal plants that have been granted free access to the world’s shared atmosphere as a waste dump. They have little understanding how incredibly attractive it is to think about generating as much energy by fissioning a tiny 6 gram pellet of Uranium Dioxide as burning an entire TON of coal – and that comparison is made while using our primitive method of once through then out rather than a closed, recycling fuel cycle.

I am here to tell you that investing the time, labor and human ingenuity that is required to build nuclear energy facilities of all sizes and shapes is worth the effort for the future of humanity – as long as your view of the future lasts more than 30-100 years. In that short amount of time, there is every evidence that the world’s accessible fuel supplies will become increasingly inadequate for the task of providing useful, reliable, affordable power that enable humans to live without slavery or backbreaking labor for all. Oil and gas are becoming increasingly difficult to find and extract. While coal boosters claim hundreds of years of supply, they neglect to mention how long the supply will last if coal has to assume the burdens currently supplied by those less available fossil fuels.

The ONLY people who benefit by delaying and deferring the resource investment required to deploy fission power systems are those folks involved in selling the fuel for existing power systems and those wasting our time and money by deploying inadequate and unreliable systems that depend on energy that we all know is weak and very unpredictable – the sun and the wind.

If you like fossil fuel addiction, keep fighting or passively resisting nuclear energy developments. Discourage your children, beat down those people like me who speak up and try to share what they have learned from a lifetime of association with the amazing gift of fission, which is clean enough to seal inside a submarine and powerful enough to supply that 9,000 ton submarine with all of the fuel that it needs to operate for several decades.

Rod Adams
Publisher, Atomic Insights
Host and producer, The Atomic Show (available on The Podcast Network, an Australian owned company hosting independently produced shows by passionate, knowledgeable producers.)

The stuff is so energy-dense that we could extract it out of seawater if we needed to.

And why would “we needed to”, several suckers and a shortage of cheaper supplies. If the suckers are forced to extract uranium from sea water Australia will have sold what it has
and made a lot of money.

Chris Warren @14. If you were to substitute ‘financial’ or ‘business economics’ for ‘economic’ then I’d concur with you.

IMO, economics is not limited to one institutional environment. My preferred description of the boundary of economics is: Economics is concerned with the study of the material welfare (as understood by natural scientists) of humans under alternative institutional environments (which reflect the dominant philosophy of a society). It was a change in beliefs about what is right and what is wrong that led to the abolishion of slavery in law.

The statement:
“When talking about constructing power plants that will most likely last for 60 years, they want me to prove that their will be a positive – and generous – financial return on their investment in just 5-10 years.” (Rod Adam @ 18 above), supports the idea that there is no ‘free market’ (in the sense of voluntary exchange) for nuclear energy production.

Well, 1 argument for nuclear subsidies is it is exposed to much higher sovereign risk. Because of its high capital costs, investors will be banking on govts maintaining carbon policies for a long time to recoup returns. What’s to say a govt won’t turn around in 10 years and remove or reduce the carbon price?

So, perhaps there is a rationale for govts entering into, or underwriting, some form of long-term, take-or-pay, type contracts to encourage nuclear development.

As I understand it, there is no need to go to zero CO2 and other GHG but there is an urgent need to reduce these emissions successively during a period of time in the life of the current generation.

In the context of Australia, what is wrong with having coal fired power generation for a specified limited set of activities (eg aluminium smelters), use gas sparingly to cover essential services and have the rest renewable?

“The statement: “When talking about constructing power plants that will most likely last for 60 years, they want me to prove that their will be a positive – and generous – financial return on their investment in just 5-10 years.” (Rod Adam @ 18 above), supports the idea that there is no ‘free market’ (in the sense of voluntary exchange) for nuclear energy production.”

I am not sure if that means you agree with the idea that it may be worth doing anyway or not. There are many facets of our modern society that we all take for granted that would never have been constructed under a pure “free market” ideology. So what? Does that mean that you would have been happier if there had never been airports, roads, bridges, and sewer systems?

“France has 80% of her energy requirements supplied by nuclear sources.
So why not Australia as well ?”

There is a big difference – France famously choose nuclear power because some said that it had “no coal, no oil, no gas, no choice”. After many years of research, I will have to add to that – France also had no profitable coal and freight railroad interests who worked hard to protect their markets from the onslaught of new nuclear power plants that competed with them.

Here is a link to a short blog post I wrote a while back about an advertising campaign run by coal miners in Australia:

@Chris Warren
Chris, I don’t want to derail the thread, but you need to learn a bit about slave economies and the systemic problems they face. Then it will become obvious to you why the Productivity Commission (as currently constituted) would not recommend more slavery (assuming it was legal). Though of course a world where we have both is highly unlikely! But you’re trolling, not arguing, aren’t you? The switch from “slavery” to “oppressed labour” is telling.

“It is hard to see that economic theory has any useful role in this issue.”

It has tremendous usefulness. You are yet to provide any reason as to why not.

I’m afraid I have to agree with Chris Warren. The abolition of slavery has created great economic distortions and inefficiencies, and even before the abolition significant inefficiencies existed because slavery was limited to only a portion of the population.

Restrictions on the transfer of property rights in labour is just another example of government interference and red tape in the free flow of commerce. One more example of the nanny state trying to restrict the invisible hand and to place limits on individuals making decisions about what is best.

If scope for the transfer of property rights in labour were reintroduced there would be numerous benefits. Property right holders would find it worthwhile to educate their labour units as it would increase their productivity and, hence, value. Productivity would also sky-rocket because you would be able to introduce more comprehensive performance management systems. Old or otherwise useless units would no longer crowd our streets asking for handouts or become a drain on the public purse because they would simply be decommissioned.

I am sure the Productivity Commission has already done work on the topic, that this research has not been released to the public. With the numbers of green communists troublemakers conspiring to attempt to introduce a nanny world government with concerns over a nonexistent threat from global warming, they probably considered that releasing the research, at this time, would probably give these radical greens something else to protest about.

But don’t worry, I am sure the topic is on the long term microeconomic reform agenda.

” It’s high risk low return politics, especially for the ALP. Since the ALP is likely to be in power until 2013 and probably 2016 federally and even the Liberals would be unlikely to try this first term or even propose it when the election was in the balance so it would seem 2030 would be the earliest date we would get any such facilities, allowing for the most likely approval cycle.
”

Great – hopefully by then they will have some better ideas than nuclear. Rehash Fran. Rubbish in…nuclear out.

“The Greens are attempting to break the political deadlock over emissions trading by suggesting an interim two-year scheme with a fixed price on carbon.

Greens Senator Christine Milne is writing to the Government and the Opposition proposing a carbon price of $20 a tonne…

…….Dr Frank Jotzo, a leading environmental economist from the Australian National University and an adviser to the original Garnaut Review, believes the Greens’ plan will deliver business the certainty it wants and start cutting emissions.

“This is a very sensible proposal,” he said.

“It was first suggested by Professor Garnaut to start the emissions trading scheme system with a fixed price and I believe that it’s even more relevant now in the political deadlock that we’re finding in Parliament.”

Fred – I think the Greens proposal is very interesting. They would need to change three things to win my backing.

1. Limit it to electricity and transport.
2. Use the revenue for tax cuts (eg payroll tax, a higher tax free threshold for income tax) instead of spending it on handouts and subsidies.
3. Remove the suggestion that it is a temporary measure that will be replaced by an ETS.

As it stands I think it is an interesting idea. I’d suggest that in political terms Rudd would be wise to leap at it.

“Yes, it costs a lot of money, but the revenue accrued from running a power station for 60 years easily covers the cost”
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That’s true Robert, but you need to either force whoever builds and will run it to put down a massive bond to start with, or you end up taking the risk that the company that owns the plant (or country in some cases) will not be able to afford to get rid of it at the end of it’s life cycle, so someone else is left with a huge bill (generally known as the tax payer, or when the country can’t afford it, generally known as the neighbour that doesn’t want a dangerous reactor next to them). I personally quite like nuclear power even ignoring climate change (no smog, relatively cheap), but I think the first would be politically unpopular because it adds what appears to the general public to be a huge amount to the initial start-up price.

In Finland people ski to work, so why shouldn’t we here. Obvious answer is we don’t have snow.

France would have 100% Concentrated Solar Thermal Power if they had the climate and the suitable land to place the collector arrays, but they don’t so they have Nuclear electricity, and nuclear weapons too.

Australia does have endless solar opportunities, so that is what WE will be doing. And France will envy Australia for the eternally free fuel powering our national growth as their nuclear power becomes steadily more expensive and the maintenance of their nuclear machinery becomes ever more problematic.

There are those who feel that Australia should be hunting and killing whales because the Japanese do it, and that every Australian should carry guns because the Americans do that, also that our farmers should grow opium because the Afghanis do. Yes?

There is one thing that that we all should really do, and that is drink tea. Not because the British do, but because it tastes nice and it is healthy. So I’m going to have mine right now.

Rod Adams :@Ernestine Gross #21
You wrote:
“The statement: “When talking about constructing power plants that will most likely last for 60 years, they want me to prove that their will be a positive – and generous – financial return on their investment in just 5-10 years.” (Rod Adam @ 18 above), supports the idea that there is no ‘free market’ (in the sense of voluntary exchange) for nuclear energy production.”
I am not sure if that means you agree with the idea that it may be worth doing anyway or not. There are many facets of our modern society that we all take for granted that would never have been constructed under a pure “free market” ideology. So what? Does that mean that you would have been happier if there had never been airports, roads, bridges, and sewer systems?

1. Nuclear power plants may last 60 years but the waste lasts much longer and so do the consequences of accidents and leakages. While the nuclear lobby is trying to exploit – shamelessly – the GHG emission problem, it interestingly does not lobby for a contingency levy for future generations, expressed not in money but in real resources (eg areable land, water, …). A real resource levy would be a transfer of ownership rights to future generations that are affected by nuclear waste and contamination.

2. I don’t advocate a ‘free market ideology’. However, the theory of a market economy does provide some helpful insights to distinguish between democratic governments whose involvement in the economy is for the benefit of the people in its jurisdiction versus a government that is acting on behalf of corporate interest groups.

3. As for France, beside the lack of fossil fuel one may also remember that France had a policy of military independence from the then existing nuclear powers. That is, France developed atomic bombs and nuclear power plants.

4. Finally, I can’t see how nuclear power is going to help to mitigate the serious unequal economic development (in particular technologically) in the so-called ‘globalised economy’.

Actually we should carry guns because the kiwis do not because the Americans do. We shouldn’t try and be like the kiwis in everything but on firearms they have a superior set of policies and attitudes. We could try grass skiing to work. And there our damn whales so we should shoot them and sell them to the Japanese instead of letting them poach them for free.

“those wasting our time and money by deploying inadequate and unreliable systems that depend on energy that we all know is weak and very unpredictable – the sun and the wind”

Gosh, Rod. It is understandable that people can package up Nuclear Fission into a tidy problem free mental image because nuclear radiation, free neutons, are invisible. People do not know that their dna has been altered by the bombardment of high energy particles that pass right through their bodies like tiny bullets, that their shortened future will certainly contain a battle with cancers of various sorts. Nuclear proliferation would guarantee that we all become affected by the insideous leakage of the ultimate toxins that the nuclear industry produces.

Nuclear fission is the cane toad of energy systems. Yes it works to some degree. Yes it is safer than it was. But no it is not completely safe, nor is it necessary. And to make the statement above, you clearly must live where the sun does not shine.

Alice, you don’t actually add anything to the discussion by being nasty about people. Why don’t you direct your obvious passion at the post and the debate, rather than slagging off Fran? or you could just call her a secret rightie again…

@BilB
That is a big simplification. Hong Kong is not quite the full libertarian thing – it’s got a lot going for it though, as long as you aren’t poor, sick or unlucky. I thought Estonia and Somalia were supposed to be the libertarian wet dreams 🙂

Even Nobel prize winning economists recognise that economics cannot deal with all externalities and must eventually relay on government to tell people what they can and cannot do to obtain better outcomes [see R Coase – J. of Law and Economics – Oct. 1960, v3.]

Jarrah-type economics, like many others, pretends to do one thing, but in fact does the opposite.

… Australia should forget about nuclear power entirely for at least the next five years

Maybe its just me, but I should have thought that if you think you are going to eventually need something and you know that it has a long lead time you’d want to start sooner rather than later. Sorta like carbon abatement generally.

That’s especially so if the most time consuming but cheap parts of getting it going are political, regulatory and planning rather than actually building (the US experience is extreme on this – we can surely do better than that but it’s still likely to be long).

The other point to make is that nuclear technology has better long-run prospects of getting big cost reductions than the likely carbon-reduced alternatives. That’s not an argument for its immediate introduction (lets see if those prospects are realised), but it is an argument against knee-jerk opposition to the very idea of nuclear power. We should be preparing the ground; training some nuclear engineers and doing our share of the R&D.

That’s true Robert, but you need to either force whoever builds and will run it to put down a massive bond to start with, or you end up taking the risk that the company that owns the plant (or country in some cases) will not be able to afford to get rid of it at the end of it’s life cycle, so someone else is left with a huge bill

This is a good point, but it surely applies to all such basic industrial facilities.

What I would do is to compel the developer of the facility to “borrow” the money needed to replace the plant at the end of its effective commercial life (e.g. 40 years) which funds would be held in escrow. The plant is subject to compliance with all relevant standards and in extremis it it fails to make adequate remedy on direction within the time needed the state can step in and use so much of these funds as are needed to bring the plant up to code and compel the plant operator to redraw and refinance the debt. A persistent non-compliant operator (or one that went bankrupt) could have its licence forfeited to another properly qualified operator by tender and forfeit to the winning tenderer its escrow funds. If and when a fully compliant plant operator decided that the sunk cost had been fully recovered and wanted to rebuild or reconfigure or simply leave the business, these funds would be released when all of its obligations were fully discharged.

The debt service costs of this loan would then be built into the wholesale energy cost, minimising intergenerational debt inequities. Imagine a situation in which some new breakthrough improvements in technique became available half way through the sunk cost recovery period (e.g 18-25 years in). Instead of needing to raise new capital, the operator could draw down the requisite funds, make the improvements, reconfigure its loan obligations to cover the new sunk cost end-date and move on. That way, we would have each facility persistently approaching maximum efficiency without dead-weight costs militating against renewal.

“why are you in Australia, when you could be living in Hong Kong where they pay almost no tax at all.”
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I did work there for some years, and I might go back — especially if mainland China replaces their smog-stacks with nuclear-stacks and the air gets cleaner. Also, I’m not sure “almost no tax at all” correlates well with 16% tax. Personally, I wouldn’t encourage people too much, because last time I was there, I was also surprised at the number of Australian professionals working there (teachers, doctors etc.) that Australia can ill-afford to lose. I imagine this will be a problem for the nuclear industry — even if you want reactors, it might well be hard to get enough staff that know how to use them.

Chris Warren, you start your entire premise about oppositon to nuclear power by stating that the concerns with this technology are not economic. But you didn’t state what those concerns are. This is a real gap, you have assumed we know what you’re worried about but the fact is we don’t. What are your non-economic concerns with nuclear power, simply stated?

wilful
I posted here some time ago a lengthy description of the failures of nuke reactors to deliver what the proponents promised in terms of some of the following reasons why nuke reactors are not feasible:
[1]safety – several reactors having accidents in different countries in recent years releasing radioactive material in one case undetected for years.
[2]-cheap electricity, -in many cases any electricity at all due to closures caused entirely by engineering and other faults. 3 countries at least have had to shut down all nuke electricity generation for lengthy periods of time due to faulty designs and/or accidents.
[3]- delayed and lengthened building times and higher than initially promised costs
[4]- performance claims -the superduper you beaut ‘new’ reactors, the stuff of wet dreams for nuke proponents, not actually existing but always promised as just over the horizon
[5]-significant levels of GHG emissions over the full cycle, lower than coal maybe but far higher than the alternatives

And….most significant of all…..NO answer to the expensive dangerous long term waste problem[please don’t respond with the claim that new tech cuts storage time down to only 10-20 generations].

There is simply no reason to even consider nuke.
Much better to invest in safer, cheaper, baseload capable, proven technology of the sustainable type that is ready to go virtually now.

BTW I’ve come in late on this thread so if I’ve covered material previously covered ..sorry.

Chernobyl happened, and commercialisation will introduce, in time, similar short-cuts in nuclear plants due to commercial pressures for shareholder returns.

Rogue states and terrorists will plausibly develop nuke weapons in the next 500 years.

Nuclear technology perpetuates global Third world – First World dichotomy. Haiti is unlikely to afford nuke plants but can develop solar, wind and tidal. How can small states – Chad, St Helena, Monaco expect to have afford nukes and have sites for location and waste storage?

But most importantly, experience has shown that industry lobbyists lie, misrepresent, buy influence and elections, and do not maintain agreements after the event. They protect themselves with commercial-in-confidence precepts and we only find out about nuclear accidents long after the events. We have learnt a lot through the nicotine wars, so we need to be protective against simplistic arguments being peddled by economists and nuke industry websites. We have no way of knowing that we know how many nuclear accidents have in fact occurred.

The amount of investment in nuclear plants is damaging investment in better alternatives.

Switching to nuclear does not address underlying problem as to why we need more and more population, debt and energy?

@fred
fred, the only one of those issues that isn’t strictly economic in nature is safety – for those of us with a distaste for actuarial type discussions where lives are assigned an economic value.

I think you’ll find that the latest, suerduper you beaut new reactors, the “Gen 3+” types are in fact now being built, are in existence. The final cost of the tenth or hundredth of this design hasn’t been determined yet, but we’ll know one day…

I think you’re completely and utterly wrong on #5. This shibboleth has been demolished many times.

And I’m curious to know what “safer, cheaper, baseload capable, proven technology of the sustainable type that is ready to go virtually now” is.

Fran, whilst your suggestion sounds like a good idea, it’s basically the one that has had many problems in the Europe and the US. Basically, the escrow funds were never big enough (presumably it’s hard to estimate costs of something in 60 years time), and I think in Europe in some cases they got used for other things (a bit like the Aus. government looking at the Future Fund I guess). I can’t find a good summary now, but here is quick summary of stuff going on in the US. Europe is in an even worse position I believe. That’s why I think the upfront fund needs to be over-estimated, not held at all by the government, and preferably guaranteed by someone else. I realize that’s a problem for many industrial things, but I’d rather have, say, Coode Island next to me than a reactor that didn’t get decommissioned. Whilst I like nuclear power (having breathed in enough coal smog for two life times), such a big number to start with is sure to put the public off it, although I could be wrong.

One suspects that the problem wasn’t estimating future costs but having the political will to impose an appropriate charge in a climate in which CO2 and other fossil fuel pollutants were uncosted.

It’s a simple enough thing to work out a dollar cost for replacing the plant today and dealiung with the projected volume of hazmat today and to allow rolling averages based on cost curves already established in the field. If anything, one suspects that costs will fall in real terms 40 years from now so any one based on historical data ought to be generous.

The amounts could be reviewed on a 3-5 year cycle based on contemporary analysis — which would itself be an incentive for ongoing R&D.

“cheap” “efficient” nuke energy for some, that cannot be shared amongst all the worlds nations

It can be shared, either directly through UH3 small scale nuclear batteries, or by supplying power via HVDC from secure locations.

and that risks a very rare accident but with catastrophic outcomes …

The calculus is wrong. There can be no accidents these days that have “catastrophic consequences” in properly designed plants. TMI melted down and killed … nobody.

What is certain is that the ordinary operation of coal plants meets the catastrophic failure standard every year. And when there is an accident, it is even worse.

The actual cost of renewables is likely not merely to be more expensive but orders of magnitude more expensive than coal or nuclear. That means that in urbanised locations within developing countries, coal and gas or oil will dominate the supply of energy, with all that entails. Insisting they pay for renewables, is unrealistic. Supplying them with the reneawables isn’t much more realistic.

@Chris Warren
Chris, you were the one who made a distinction between ‘moral’ and ‘social’. I merely continued your distinction, bizarre as it may have been, and asked for clarification.

You appear to have an image in your mind of economists as bald bespectacled beancounters who know the price of everything and the value of nothing. This caricature is plainly false – this whole argument is taking place on the blog of an eminent economist who is renowned for taking the “social aspect” into consideration.

So now you are accepting “economistic dogma”? Flip-flopper. Looking at your list of externalities, the only one I can see not amenable to economic analysis is the future threat of nuclear weapons. This is because of the massive margin of error that would have to be applied, rendering quantification almost useless. But by the same token, NO form of analysis can tell you whether the risk is greater than the reward (which is what we’re trying to establish).

“must eventually rely on government to tell people what they can and cannot do to obtain better outcomes”

This assumes perfect government. I see criticism of the assumptions behind ‘perfect’ competition models in economics all the time, rightly so. Yet strangely these same critics commonly believe that, merely by being in government, certain groups of individuals will transcend the real-world limitations on those assumptions.

“Rogue states and terrorists will plausibly develop nuke weapons in the next 500 years.”

I think John’s assessment is a fair one. There is only one way nuclear power will be considered seriously in Australia — seriously to the point that there is bipartisan support, which is an absolute necessity — and that is if the economics work.

I’m quite resigned to the fact that we are not going to be the ones to prove or disprove this question — it will be left to developing economies like China and India, and other nations that have immediate reasons to pursue nuclear power (South Korea and Japan due to lack of any apparent alternatives, UAE and other oil/gas rich nations that wish to sell rather than use their prized non-coal fossil fuels). The FOAK and replicated build action is happening now in these places, and in 5 or so years, the world will be in an excellent position to assess just how well these projects have developed and how the economics of nth-of-a-kind builds stands up.

What does this mean for nuclear in Australia? There is no time for foot dragging. We should be conducting a serious and ongoing public dialogue on the issue, monitoring and learning from international experience, training our next generation of engineers and upskilling the relevant components of the workforce, investigating appropriate ways to license and legislate for the site requirements, reactor safety oversight, and so on. There is much to do in the next 5 years on the nuclear front, even it if doesn’t involve pouring concrete foundations!

Chris, you were the one who made a distinction between ‘moral’ and ’social’.

In a moral society there is no distinction, and I do not make a distinction between social and moral. I require social outcomes to be moral at the same time. I do not make a distinction – both apply together – moral outcomes must apply to society.

This is rubbish

You appear to have an image in your mind of economists as bald bespectacled beancounters who know the price of everything and the value of nothing.

i never said this and it is not my view.

This is rubbish

So now you are accepting “economistic dogma”?

What dogma?

More rubbish

This assumes perfect government.

There is no assumption of perfect government. I presume that a responsible, democratic goverment based on separation of powers is sufficient.

Jarrah you should stop putting false words into other peoples’ mouths and then criticising the false words.

If you cannot understand the likely amount of political changes amongst world powers that occurs over 500 years (and possible risks) then you are not competant to deal with such issues.

No chris, the problem is that you’re leaving it open for interpretation. Don’t be all passive aggressive smartarse on me*, all I’m asking is for you to clearly state what your problem is. There was some problem with the thread here, obviously, where you clearly articulated genius failed to show through. I didn’t see your post at #11 until after I’d asked you to clarify what the hell you were on about.

Anyway, your argument at #11, is that what we should respond to?

* actually, go ahead, I’ll just ignore you as someone who’s more interested in winning arguments than debating ideas.

So either you are making a distinction, or you consider “social, environmental, generational and moral” to all be the same thing.

“i never said this and it is not my view.”

But you did say:

Commission economists would take the “good” economic effect without looking at the “bad” social and moral aspect…the general uselessness of economic logic, that argues for nuclear power based on it providing a cheap “good” ignoring the social “bad”…simplistic arguments being peddled by economists

So obviously you consider economists as having little to contribute beyond glorified accounting. As for ‘dogma’, I was pointing out your inconsistency in decrying economic analysis, then citing economists.

“I presume that a responsible, democratic goverment based on separation of powers is sufficient.”

Sufficient for what? And I put it to you that in fact your claim that we “need” government to tell us what to do because we can’t choose it for ourselves relies on heroic assumptions about the capacity of government to assimilate and act upon information in an optimal (or even ‘better’) way.

To those who find fault with nuclear’s need for government support I could point out that the fossil fuel industry gets plenty while showing little sign of belching fewer megatonnes of CO2. For example the WA and Federal governments have indemnified Chevron the operator of the Gorgon gas field. If any or all of an eventual 120 million tonnes of CO2 escapes from storage in a saline aquifer below Barrow Island the taxpayers pay all damages. That’s CO2 that was already dissolved in the natural gas; the cleaned gas still creates more CO2 when it is burned. In the US nuclear indemnity, the Price Anderson Act, went through legislation. To my knowledge the Oz gas equivalent is purely an administrative decision.

The economics of nuclear energy,as always, requires olympian optimism. No matter how sure the numbers they always balloon to the ridiculous in reality. And nowhere has yet shown how the the cradle to grave costs can be justified. Always hiding costs and hoping noone notices. No matter, the proponents win if ground is turned, and the sunk costs preclude cancelling the project.

I’m actually supportive of nuclear in the energy mix. Maybe someone can oneday prove that it’s possible to build a safe reactor on a sensible budget. It’s silly for Australia to consider it at this stage though.

Fran – it is somewhat amazing that cutting payroll tax is too complex and yet lumbering industry with mountains of red tape isn’t. If we can have wall to wall Labor across state and federal tiers and they can’t work things out through dialogue then what business do they have telling the rest of us what to do.

I don’t doubt that nuclear does work but it shouldn’t do so without strong regulation – which makes it less of a libertarian’s ideal energy source.

Back to geothermal; I’m not sure it’s ever gotten much serious funding and definitely not the kind of fast-tracking nukes got to get started and that geothermal needs. Australian gov’t R&D funding strongly favours Carbon Capture but I suspect that’s only because they are the captives of carbon. Geothermal’s share is a pittance in comparison. Large scale energy storage’ share? I suppose we’ll rely on the laptop market for battery R&D and hope it’s scalable. One thing for sure is that it won’t become a high priority in Australia.

For all the hype about new gen nuclear, there doesn’t look to be a lot of it yet. It sounds promising – but so do highways paved with solar cells.
Isn’t the real problem that we don’t want clean energy enough to pay extra for it and all the policies to tackle climate change involve no significant costs and negotiating to do the very least we can get away with.

I think that Pr Q’s point that nuclear doesn’t look economical without a strong carbon price is where the most likely answer lies; put a big price on Carbon and a lot of alternatives to fossil fuels, including nuclear, will look more attractive. But that would be a “big new tax” no matter where and how productively that revenue gets spent. Of course, the moment that looks like becoming reality will be when the rolling shutdowns of coal plants will begin – to show everyone who has the real power in Australia’s energy sector. It’s a sector that will welcome nuclear no more readily than renewables and it’s not above flexing it’s muscle.

To free up a lazy $20 bil I suggest cutting the broadband rollout in half. Satellite and wireless internet provide reliable alternatives to fibre optic cable. $20 bn might buy three gigawatt nuclear power stations with integrated desalination. I’m pessimistic that any form of the ETS that gets up will impose a serious carbon price, more than say $10-20 a tonne. The Commonwealth could lend the funds at low interest to generators who agree to retire coal fired power stations.

The problem of nuclear waste has been mentioned by several commenters. As for safety, there seems to be a perception that there have been improvements since Chernobyl. In one sense the perception is justified (there hasn’t been another event like Chernobyl) but in another it turns out to be a bit more complex even if one assumes that no more Chernobyl or TMI events will occur.

Below is a link to a May 2007 paper, authored by seven EU and USA scientifically qualified specialists, titled “An Account of Events in Nuclear Power Plants Since the Chernobyl Accident in 1986”

To call nuclear energy ‘clean’ is, IMO, irresponsible public relations stuff which may be counterproductive.

To illustrate difficulties arising for individuals, consider the following bits of information.

1. The said ‘improvement’ does not exclude the release of radioactive iodine 131. Only if the release of this agent exceeds a specified annual limit will it count as an ‘event’.

2. Individuals who have a particular thyroid condition abosorb radioactive iodine 131 more (in some precise sense which is too long to specify here) than other people. This is harmful.

3. The only known cause of non-H. lymphoma is radiation.

How easily would an individual with condition 1 find the bits of information 2 and 3? How is the individual supposed to choose a place of residence and how often does this individual (and family if applicable) have to move? These are practical questions.

@Ernestine Gross
To my knowledge nuclear facilities and even airports are supposed to detect for radioactive iodine (I129 and I131) then immediately intervene. Release events were in the past like the A-bomb testing days. OTOH we get a double whammy from coal burning, global warming plus diffuse radiationhttp://www.epa.gov/rpdweb00/tenorm/coalandcoalash.html

@Ernestine Gross
Ernestine – thanks for this link on the residual risk of the nuclear industry. It is a very good study.

It is a long paper but for anyone here who thinks that nuclear energy is the solution to the problems of AGW and or brushes aside risk of nuclear failures like Chernobyl (on the basis that “nothing has happened since”) dont miss this.

So Ill post Ernestine’s link again (and Ernestine – this should be a regular standing journal link – to be posted monthly!).

Having read through all of the other comments I think JQs perspective is fair. That being that nuclear is someway off, if at all. Further that it only makes sense if you are convinced that the current approach to baseload power is required.

I would have thought that the need to change from coal presents a whole range of alternatives, that need to be considered. Why not move to a much more diversified energy network. If I have solar panels on my roof, and send all my garbage to a small waste-to-energy plant (that is located where the current transfer station is), how much significant “baseload” power will be required? This distributed approach also encourgaes me as the consumer to minimise my energy usage and to update my technology whenever I wish. I would have thought that like so many things that an individualised solution was likely to be the way of the future.

Yes industry will require energy, but perhaps that simply becomes an additional factor when siting a new plant. So it means you have your aluminium smelter adjacent to a major solar facility, or wind, or geothermal, or tidal.

Then you dont need nuclear – unless industry wants it and can justify the cost and clean up. Which I would think in a modern world would be unlikely as many of their shareholders would be unlikely to support the notion.

Although I am in favour of including nuclear power (especially throium, IFRs etc) in Australia’s (and the world’s energy mix) I don’t disgree with the kinds of no regrets measures you propose. These and others I can imagine would seem eminently sensible in terms of waste management, energy efficiency and public buy-in of the broader goal of having a small footprint. I strongly support urban consolidation, and within that model, localised energy options (such as roof-mounted wind on high rise), ground-heat pumps perhaps incorporating waste heat from stored onsite waste, relatively localised processing of sewage and grey water and associated water recycling, some localised pumped storage at the same facilities, increased local public transport, parking hubs connected to transport nodes along main connecting roads, marginal real-time charging for access to road infrastructure and so forth …

Where I part company with the many of the advocates of such measures is the idea that these (along with renewables) represent a whole solution to the problem of decarbonisation. They don’t and can’t. At best really good ubiquitous measures can slow the growth in emissions in greater volume and at at lower cost and earlier than can new clean energy sources. It’s the low hanging fruit, but as the allusion implies, once it is picked, it is gone. If you haven’t also decarbonised by the time that day arrives, emissions (both of GHGs and associated toxics), will continue to accrete. This is especially true if a substantial part of what is now transport energy demand gets put onto the grid (which is after all one of the things one would want to do). It’s also very clear that world population will continue to grow until at least 2050 and thopse 3 billion of us now (and their successors) who live a lot worse than we would minimally accept will need to do things that will increase their per capita energy demand. Again, good design of human systems can slow this growth relative to what it be if they copied the western model, but it won’t eliminate or reduce it, obviously. While rural Asia, Subcontinent, Africa and Latin America can obviously make significant use of renewables (especially the non-grid-connected parts) urban areas will need serious baseload capacity if they are to be able to supply their rural hinterlands with the light industrial goods they will need.

In some cases — geothermal may be a good renewable baseload option — certainly those with access to the geothermal energy of the Rift Valley in East Africa will do well to use it. That said, figures of $5-10,000 installed are being quoted. Until some serious plants go up, we simply won’t know.

@JJ
Given that the six aluminium smelters allegedly pay (it’s a commercial secret) only 10% or so of what households pay for electricity, I doubt whether substantial price increases are politically possible. Thus a smelter paying 3c per kilowatt hour for grid electricity is not going to pay 30c and survive the overseas competition. To get a regular enough power supply from non-hydro renewables will require excess generation capacity and energy storage, both expensive. The process before smelting that converts bauxite to alumina is also energy intensive. That’s why the aluminium industry got free permits under the ETS due to trade exposed status. I think a cash subsidy or tariff protection would be more transparent.

As to some other ideas about distributed small scale generation I don’t see the evidence that they work on a pilot scale let alone getting enough public participation. Carbon penalties may tip the odds somewhat but then we are all paying more. The major replacement for coal must have massive grunt and round the clock reliability.

That’s why the aluminium industry got free permits under the ETS due to trade exposed status. I think a cash subsidy or tariff protection would be more transparent.

Personally, I’d favour making them pay full price and then forcing them to choose between trying to sell stranded assets and trading with their costs internalised.

Australian aluminium (well the aluminium in Victoria certainly) is some of the filthiest and most CO2-intensive aluminium in the world. If the smelting went anywhere else, it would be cleaner, even allowing for transport costs. (In practice, it would probably go to Queensland)

Really, with the subsidy being paid, you could put every displaced Victorian aluminium smelter worker on a “retraining” stipend of $50K per annum for the next ten years and still have plenty of change.